Movies Are Not A First-Weekend Game: Siddharth Roy Kapur

An MBA from the Jamnalal Bajaj Institute, Siddharth Roy Kapur has been involved with all aspects of film making: Creative, development, production, marketing, distribution and syndication. He will soon become MD of The Walt Disney Company, India, from January 1, 2014. During his stint at the Studio business, he has produced many hit films such as Rang De Basanti, Parineeta, A Wednesday!, Paan Singh Tomar, Barfi!, Heroine and the recent superhit Chennai Express. He talks to Forbes India about the changing co-production model in the film business, the latest trends in film marketing and reflects on the genre of films that pull in the crowds today.

Q. How do you select movies to produce? Is it a scientific or business plan approach?
It’s ultimately based on the script. Do you like it? Is it commercially viable? Is it exciting? Will you be able to cast it in the way you think the film should be cast? All these factors you would consider even in Hollywood before you green-light a film.

Q. Do you decide projects based on the stars you have cast, or is it the other way around, where you first hear about a project and then decide which star to cast?
Every year we have a sense that we’re going to make around 18 movies [12 Hindi movies and 6 movies for the Southern region]. The 12 Hindi movies are generally divided into four tent-poles [big-budget films], four medium-size films and four smaller budget films. We start looking at two years ahead; planning happens much earlier. When you’re evaluating scripts, it’s all in the parameter of: This is a film that needs a certain budget so I can go one route and cast it or do what is best for the film [does it need a star?]. Some films need to be mounted with a star because that’s the type of films they are. If we’re making a Kai Po Che, it’s the story of three young men, we don’t want one to overwhelm the other two, so we can’t cast one star and two who are not. In Chennai Express, you need the flamboyance and the draw of a star to carry off that sort of role. You ensure that with Rohit Shetty, Shah Rukh Khan and Deepika Padukone in the film. So its horses for courses—your content dictates it rather than the other way around.

Q. Is co-production now the norm when working with big stars?
Today with any big star, his production company is always involved in the making of the film. That’s just the way the movie business has grown. In Hollywood, stars used to enjoy gross points from the first dollar earned on a film [Hollywood stars get a certain percentage of the profit a movie makes]. Similarly, India has evolved into a co-production structure that you enter into with your top star. The star could choose to co-produce the film with you or he could choose to just be paid a back-end [post release amount], in which case there’s no branding but there is a back end [benefit] that the star would enjoy in the film.

Big stars are no longer just working on a performance fee basis. And we are happy for that. Stars are happy because we’re sharing the risk.  

Q. So there is a small sign-up amount and the balance to be made only when the movie is a hit?
I wouldn’t say it’s a small amount. There’s an artiste fee that’s built into the cost of production anyway when it’s a co-production deal.

Q. Then what’s the benefit for a star to enter into a co-production deal? They, in any case, budget the fee in the deal.
Because they all have experience in the industry and feel they can bring a certain production know-how and value to the process. And frankly they have. They [also] like their films to be produced in a certain manner.

Q. Now with all big stars doing only one movie a year, does marketing play a dominant role in a film’s success?
I wouldn’t say it plays a dominant role. It certainly has a big impact on the way a film opens, but after that the film takes over. The post-release promotions we had for Chennai Express helped keep the film in the public eye. But I daresay had the film not been appreciated and liked, it wouldn’t have gone this far. It’s a combination of the two: If you don’t promote a film, you’re not giving anyone a chance to get excited about it. On the other hand, if you’re promoting a film that’s not a very good one, you’re going to open big and crash on Monday.

Q. But if you do promote well, does it at least help you recover the money in the first weekend?
The scale at which these films [big budget movies] are at, not really. It’s not a first-weekend game for big budget movies. That’s possibly only for small and medium budget movies. But if it does great the first weekend and then it drops precipitously on Monday, I don’t think any film can be considered successful. A large chunk of your revenue does come from the first weekend but then the sustenance dictates the way the film is perceived by the public as well as by the trade [as a hit or a flop or a weekend wonder]. So, all of us are gearing up for the lifetime business of a film rather than its first weekend.

Q. Revenue-wise, other kickers like satellite rights have come in. Is it still safe harbour if you’ve done OK in the first weekend and made decent satellite revenues?
If you’re talking about being safe, absolutely. If you’ve pre-sold your satellite, if you’ve pre-sold your other rights, you’ve got a great weekend, etc… you will be in a good place. Having said that, we’re in the business of generating IP [intellectual property] which needs to last a lifetime. The success of a film dictates its longevity as a revenue stream. If you have a film that at the end of 10 days is going to be a flop, despite being in a ‘safe harbour’ position, that doesn’t bode very well for the lifetime revenues of the film. Because the badge is that of a film that hasn’t worked and your subsequent satellite sales and sales on other platforms will be definitely lower due to it. So, you have to gear up to create IP value that lasts and pays off over at least 10-15 years. That’s what studios are built on today.

Q. How does Disney’s acquisition of UTV help you?
We are the Walt Disney Company now in India. We’ll have movies that are both Disney and UTV branded. We’re creating movies locally that are Disney branded [Amir Khan starrer P.K., Jagga Jasoos with Ranbir Kapoor]. Our combined slate will also include Hollywood content that comes out of Disney, Marvel and Pixar. We will do their distribution, marketing and release in India.

Q. Does that help you build more distribution muscle?
It does. Because then you go out to the exhibitor saying I’m bringing you Hindi movies, I’m bringing you Southern language movies, and I’m giving you Hollywood movies of the range of an Iron Man or an Avengers that are dubbed in four languages.

Q. What is the role of digital marketing?
It’s quite tremendous. One, its share has gone up in the overall marketing budget. Two, the amount of time we now spend discussing it as another means of marketing due to the growing internet penetration. Social media platforms have increased. And movies also lend themselves to being marketed on these platforms.
 
For Ship of Theseus, a regular P&A [print and advertising] budget did not make sense because it was an experimental film that catered to a limited audience. But that audience is dispersed across various cities and obviously more concentrated in bigger cities. We decided to do an online and social media campaign. We didn’t use any above-the-line advertising [using mass media]. We started out in six cities and we told the whole country to vote for their city if they wanted the film to release there. We had a certain cut-off in every city we listed to justify us going there. We had to eventually increase from six cities to 37. It did tremendous business. That’s one example of using only digital. And our budget for digital was almost negligible compared to other mediums.

But the digital approach always depends on the kind of movie. Now, if you’re doing Ship of Theseus its fine, but if you’re doing Chennai Express it’s not. For Chennai Express, you’ve got to use every platform available. So we don’t have templates. For example, if it’s Rowdy Rathore, a far more mass-oriented film, it’s not going to appeal much to your Facebook and Twitter group. You’d still market it there, but you’d also do city visits, regional media, radio and TV extensively.

Q. The role of marketing has increased in promoting films, but so have the budgets…
P&A budgets have increased because the number of mediums available to promote a film has increased.

The ‘need’ also arises because your audience is more fragmented across platforms. Twenty years ago, you would have reached 93 percent of them by advertising on the Mahabharat TV show. Today the show with the highest TRP would reach just a fraction of your audience, and won’t even scratch the surface of what you need to do.

Q. What changes do you see in audience tastes?
They are accepting both [mainstream and offbeat subjects]. I don’t see any move away from enjoying a mainstream masala entertainer like Chennai Express or Dabangg. People come, have a great time with their families and go home. They’re out in smaller numbers, of course, for a Madras Café or a Kai Po Che. Tastes have changed but that doesn’t affect the mainstream audience. They go see both kinds of films! I think people will enjoy great cinema which is different in terms of genre, as long as it entertains them. We saw that in 2012 in a stark manner in our own state [Maharashtra], with both Rowdy Rathore and Barfi! crossing the Rs 100 crore mark [net box office].

Q. Do you need to be self-sustaining and fund yourself from internal accruals or do you borrow from the US parent, especially if you were to do double the number of movies?
I can’t comment on that but we’ve been doing quite well as a studio. We’ve got the latitude to determine what our strategy is and bring everyone on board. We need to decide locally how fast we want to grow.

This isn’t a scalable business beyond a point. The idea is you want to make bigger movies sure, more innovative movies, but it’s not always about making more movies. We want to make movies that are more profitable, that up the ante in terms of creativity, that do path-breaking stuff. But it’s not about “let’s take 12 movies to 24 movies”. Like studios in the West, we’ve realised that the senior management’s time and attention on every individual project in this business is crucial. When you spread yourselves too thin across a wider slate of movies, that tends to get diluted. We’re definitely not into the factory assembly-line approach. We want to be intimately involved with every film. That’s what matters and differentiates us from anyone else.